Dillard’s to pay special cash dividend

Published: Tuesday, November 27, 2012 at 03:05 PM.

Department store operator Dillard’s Inc. said this week it will pay a special cash dividend of $5 per share in December.

The company also declared a quarterly dividend of 5 cents per share. Both dividends will be payable Dec. 21 to shareholders of record on Dec. 7.

“This special, one-time dividend of $5 per share reflects our strong financial position and underscores our confidence in Dillard’s,” CEO William Dillard said. “We are pleased to return value to our shareholders in this manner.”

Dillard’s — an anchor store at Santa Rosa Mall in Mary Esther — had 47.1 million shares on the market as of Aug. 25, which suggests the company will pay about $235.5 million in the special dividend.

The Dillard’s in Santa Rosa Mall recently completed a $1 million renovation that completely updates its look. To go along with the renovations, the store also has updated its merchandise and expanded its offerings.

Dillard’s is the latest company to move up its quarterly payout or issue a special end-of-year payment to protect investors from potentially having to pay higher taxes on dividend income starting in January.

Many companies are reviewing their dividend policies now that it appears investors could soon pay higher taxes. Since 2003 investors have paid a maximum 15 percent on dividend income. But that historically low rate will expire in January unless Congress and President Obama reach a compromise on taxes and government spending.

As it stands, dividends will be taxed as ordinary income in 2013, the same as wages, so rates will go up depending on which income bracket a taxpayer is in. For the highest earners, the dividend rate would jump to 43.4 percent.

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Department store operator Dillard’s Inc. said this week it will pay a special cash dividend of $5 per share in December.

The company also declared a quarterly dividend of 5 cents per share. Both dividends will be payable Dec. 21 to shareholders of record on Dec. 7.

“This special, one-time dividend of $5 per share reflects our strong financial position and underscores our confidence in Dillard’s,” CEO William Dillard said. “We are pleased to return value to our shareholders in this manner.”

Dillard’s — an anchor store at Santa Rosa Mall in Mary Esther — had 47.1 million shares on the market as of Aug. 25, which suggests the company will pay about $235.5 million in the special dividend.

The Dillard’s in Santa Rosa Mall recently completed a $1 million renovation that completely updates its look. To go along with the renovations, the store also has updated its merchandise and expanded its offerings.

Dillard’s is the latest company to move up its quarterly payout or issue a special end-of-year payment to protect investors from potentially having to pay higher taxes on dividend income starting in January.

Many companies are reviewing their dividend policies now that it appears investors could soon pay higher taxes. Since 2003 investors have paid a maximum 15 percent on dividend income. But that historically low rate will expire in January unless Congress and President Obama reach a compromise on taxes and government spending.

As it stands, dividends will be taxed as ordinary income in 2013, the same as wages, so rates will go up depending on which income bracket a taxpayer is in. For the highest earners, the dividend rate would jump to 43.4 percent.